Intraregional competition among GCC countries is normal and it has benefited foreign companies due to its encouragement of infrastructure upgrades in finance, ports, and tourism. However, the decision by Bahrain, Saudi Arabia, and the UAE to withdraw ambassadors from Qatar is an unprecedented move and it is a big deal. The political divide is over regional security, particularly Qatar’s ongoing support for Egypt’s Muslim Brotherhood and accusations of meddling in “internal affairs directly or indirectly” of other GCC states.

An extended diplomatic row between Qatar and other GCC states would have significant ramifications on the business climate, because of trade ties and the drive towards further economic interdependence within the region. For example, Asia is the top destination for Qatari exports, but Saudi Arabia and the UAE are two of the country’s top three sources of imports.

Still, the region’s long-term economic interests should help to resolve this political crisis. There is a massive amount of coordination required among GCC countries for the World Expo 2020 in the UAE and World Cup 2022 in Qatar. Without close cooperation, the region’s most ambitious projects will be difficult to achieve. More importantly, trade potential among GCC states lies within the non-oil sector. This means that maintaining good relations will be critical as each state seeks to diversify away from dependence on natural resources exports. Moving towards a sustainable economic path, in order to create jobs and raise the standard of living, is the key to long-term security in the region. The failure to cooperate would represent a far greater threat to the region’s future than the current political crisis.

Companies should take a wait-and-see approach rather than making any immediate changes to their regional investment plans for 2014 and beyond. If the political crisis is protracted, executives should assess whether there is an impact on getting goods to their markets, operating costs, and partner relationships.